30s Summary

Hats Finance founder Oliver Hörr highlighted the flaws in traditional internet security methods for decentralized finance (DeFi) projects. He has created Hats Finance to increase efficiency and accessibility of security, eliminating middlemen and overheads. Hörr suggests bug bounty programs are flawed with payment uncertainties. Hats Finance addresses this with blockchain technology that guarantees secure rewards via smart contracts. His platform prevents low-quality reporting by charging submission fees. In future, Hörr hopes top performers can offer pre-audit services for DeFi projects to ensure safety.

Full Article

If you’re following the world of decentralized finance (DeFi), you’ve probably come across the issue of security. Many people are saying that the techniques we’ve used to secure traditional internet applications just aren’t cutting it for DeFi projects. Oliver Hörr, the founder of Hats Finance, recently gave his two cents on this issue, explaining how the current security models come up short for this brave new world.

Hörr says that the usual security systems for internet sites and apps have some major drawbacks in the world of decentralized systems. He says that firms that audit code have a lot of overheads, and the person checking the code often doesn’t see much of the money. He also points out that programs that pay for bugs to be found can lead to other problems as the people reviewing the information about vulnerabilities could misuse it.

Hörr thinks there’s a better way. He started Hats Finance to make security more efficient and open. The platform makes it easy for security experts to link up with those who need their services, removing the need for middlemen. The platform already has over 50 programs up and running, helping to secure everything from individual projects like Safe and Liquity to more substantial ecosystems.

One really cool thing about Hats Finance is that anybody can use it, not just developers. It helps users be less vulnerable to attacks and gives developers peace of mind because they know their projects have been securely audited. Hörr states that by making security more affordable, they can also encourage new talents to join the field.

Traditional bug bounty programs, where companies give cash rewards to anyone who can find a flaw in their systems, are often plagued by uncertainty about payments. People who point out vulnerabilities sometimes face delays and even denials, especially when times are tough, and money is short.

To change this, Hats Finance uses blockchain technology to guarantee that rewards are secure. The bounty is held in a smart contract that anyone can verify. If a project tries not to pay out a reward, the person who found the bug can trigger a decentralized dispute resolution process. This leads to hackers more likely to report vulnerabilities, ultimately improving the overall safety of their ecosystem.

One significant issue with traditional bug bounty programs is that they can get swamped with low-quality reports from people trying to make a quick buck. Hörr says Hats Finance cuts down on this by charging a fee for every submission. This also adds money to the ecosystem, as the fees are converted into Hats (HAT) tokens, which are added to the platform’s treasury.

In the end, Hörr envisions a future where top performers from the community can offer pre-audit services for a fee, letting projects ensure they’re ready for a full audit. He’s also considering the potential challenges and vulnerabilities brought by account abstraction into smart contract wallets. Through Hats Finance, Hörr aims to ensure the safety of the continually evolving DeFi space.